When you’re in control of your profit and loss (P&L), you have a tighter hold on the reins of your profitability. Read our Plain English guide to P&L and learn how to boost your profits. #tax #accounting #businesstips #ProfitAndLoss #P&L
Here's our Plain English guide to profit and loss and what this report reveals about your finances.
What is profit and loss?
Your profit and loss statement is commonly called your ‘P&L’. It’s also sometimes referred to as your income statement or statement of earnings.
Your P&L is a breakdown of your company’s revenue (money coming into the company as sales and other income) and your expenditure (direct costs, overheads, expenses and other costs).
As a business, you obviously want to turn a profit and make money. Keeping a close eye on your P&L allows you to track your revenues and expenses over a set period, and look for ways to boost your profitability as a business.
How does profit and loss affect your business?
Being in control of your financial management is hugely important for any business. Your P&L is one of the main ways to track and analyse this financial performance.
To manage your P&L effectively, it’s important to focus on:
How can our firm help you with managing your P&L?
When you’re in control of your P&L, you have a tighter hold on the reins of your profitability.
As your adviser, we’ll help you run regular P&L reports as part of a monthly or quarterly package of management information. We can help you track, review and analyse your revenue and expenses to spot the best opportunities for boosting the company’s profits.
If you’d like to know more about the impact of profit and loss, we’ll be happy to explain.
Get in touch to chat about managing your P&L.